KBR, Halliburton Get Court Review in Iraq Billing Case

July 1 (Bloomberg) -- The U.S. Supreme Court agreed to
review a lawsuit accusing KBR Inc. and Halliburton Co. of
overbilling the federal government for work in Iraq, taking up a
clash over the deadlines for fraud suits against government
contractors.

The companies contend that a federal appeals court in
Richmond, Virginia, effectively eliminated the time limits
imposed by the U.S. False Claims Act for whistle-blower
lawsuits.

The appeals court said Benjamin Carter, a former company
employee, could press claims that KBR and Halliburton overbilled
the U.S. for work on water-purification projects at two camps in
Iraq.

The Obama administration urged the Supreme Court to reject
KBR’s appeal, saying the lower court reached the right
conclusion.

The False Claims Act lets whistle-blowers sue on behalf of
the federal government and collect a portion of any damages
awarded. That law normally requires suits to be filed within six
years of the alleged fraud.

The legal fight centers in part on the Wartime Suspension
of Limitations Act, which extends the deadlines for lawsuits
when the U.S. is at war. The companies say the appeals court’s
reasoning would mean that deadline won’t occur until years after
the president or Congress formally terminates the conflicts in
Iraq and Afghanistan.

The companies also contend that Carter’s suit was barred
because an earlier lawsuit in California had made similar
allegations.